March 13, 2013: Efforts to persuade Iran and North Korea to halt their nuclear weapons programs using economic sanctions has not worked very well. Both Iran and North Korea have developed networks of smugglers to obtain sanctioned goods and ship them to their destination. In the last few years efforts to go after international banks that these two countries use has forced both nations to work outside the banking system. This means they move cash (or gold or gems) around or use barter when that is possible. Thus the sanctions have increased costs for obtaining forbidden goods but not stopped these two pariah states from getting what they want.

Last year Iran was hit with restrictions on actually selling its oil. This cut oil income in half and Iran is scrambling to invent novel ways around these new problems. Slowly, Iran is coming up with new tricks to evade these barriers to its oil sales. North Korea has no such similar exports to sanction. North Korean exports are largely illegal items, like drugs, counterfeit American currency, and weapons (especially ballistic missile and nuclear weapons technology).

Both countries pay well for the services of their smugglers, who need that kind of incentive because a growing number are getting caught and sent to prison.